Industrial real estate market recovers strongly
New potential and trends
The Indochina Kajima Development Company, a joint venture between Indochina Capital and Kajima Corporation, recently launched an industrial real estate investment and development platform focused on the nationwide roll out of factory and warehouse properties for lease throughout the country’s key manufacturing and logistics markets. The Core5 Vietnam platform (www.c5ip.vn) plans to offer industrial assets of some US$1 billion in the next 5-7 years.
Germany’s Framas Group has rented a ready-made factory area of 20,000 square meters in the KTG Industrial Nhon Trach 2 project (Dong Nai Province). Framas specializes in the production of high-quality plastic parts for customers such as Nike and Adidas.
According to Fabian Urban, Head of Footwear Technology at Framas Vietnam, Vietnam was chosen as a factory site because of its superior facilities compared to other locations. The establishment of the new factory is part of the group’s strategy to develop the footwear sector in Vietnam, he said.
Industrial real estate projects have attracted a large number of domestic and foreign investors to Vietnam’s 260 industrial parks and 75 planned industrial zones, as well as to the southern and northern key economic zones.
Industrial real estate projects attract many domestic and foreign investors |
Vietnam’s advantage lies in its lower industrial real estate prices compared with many other countries in the region, the country’s political stability, competitive labor costs and government incentives.
Cushman & Wakefield Vietnam reported recently that the northern region has about 10,000 hectares of industrial land in five key provinces/cities, including the capital Hanoi, Hai Phong City, and Bac Ninh, Vinh Phuc and Hung Yen provinces.
Trang Bui, General Director of Cushman & Wakefield Vietnam, said northern Vietnam remains the first choice for many investors. Although they started developing later than the southern industrial market, the northern industrial provinces offer advantages for high-tech industries as reflected in the average 80 percent occupancy rate of their industrial land in five key provinces and cities.
Logistics market promise
She said new foreign direct investment (FDI) in Vietnam’s industrial parks in 2022 is focused in manufacturing and auxiliary logistics industries, i.e., industrial real estate that supports production and logistics. Vietnam’s logistics market is still in the early stages of development but has great potential for growth in the next 5-10 years with stepped up government infrastructure projects, she added. In addition, the strong growth of the middle class with high disposable income and the strong spread of e-commerce will also drive the development of the logistics market.
Deputy Minister of Planning and Investment Tran Duy Dong said the pandemic disrupted supply chains and goods circulation, and delayed projects’ implementation, causing companies, multinational corporations and countries to reconsider their business strategies and change investment attraction policies. Nonetheless, Vietnam remains an attractive FDI destination, luring growing investment from Asia, Europe, the US, and ASEAN (the Association of Southeast Asian Nations).
Economists pointed out problems that hinder the industrial real estate market’s development, including weak infrastructure connectivity between localities; increasing logistics costs due to the lack of warehouses, cargo ships and containers; the lack of specific environmental and eco-industrial park criteria, incentive policies and professional environmental, social and governance (ESG) criteria; and labor shortages in the post-pandemic period.
Experts at the Vietnam Industrial Real Estate Forum 2022 held in May assessed that FDI has been booming in the past five months since Vietnam returned to the “new normal” by bringing COVID-19 under control, opening up many opportunities for industrial capital.
Vietnam has been preparing to welcome a new wave of investment and become an important production hub by further improving its institutions and investment environment while encouraging investment in modern and environmentally friendly technologies. |
See also
The OpusK by SonKim Land Triumphs at Vietnam Property Awards 2023
10:29 | 14/11/2023 Property
BCI Central celebrates the best in Vietnam architecture, building and design industry
07:05 | 28/05/2023 Property
M&A to pick up in property market
07:00 | 19/05/2023 Property
More than a million low-income homes to be built by 2030
07:00 | 07/04/2023 Property
Strong signals of positive year for industrial real estate market
10:25 | 27/03/2023 Property
Credit crunch burdens real estate market
06:00 | 03/03/2023 Finance-Banking
See more news
Hunting for real estate investment opportunities after Tet
09:32 | 03/02/2023 Property
A great chance to invest in commercial property
10:46 | 30/01/2023 Property
Banks tightening real estate credit to limit risks
06:00 | 06/05/2022 Economy
Bright prospects for Vietnam’s industrial real estate market
06:00 | 19/03/2022 Property
Vietnam, an ideal destination for real estate investors
06:00 | 28/01/2022 Property
Leaders pay tribute to President Ho Chi Minh to mark his 134th birthday
10:05 | 19/05/2024 News and Events
Hà Nội Metro announces profit from the Cát Linh–Hà Đông metro line
10:00 | 19/05/2024 Economy
Cement makers call for scraping of clinker export tax
09:00 | 19/05/2024 Economy
Tourism sector goes green for sustainable development
08:22 | 19/05/2024 Tourism
Digital transformation in logistics - a key to unlocking sustainable e-commerce and economic development
07:00 | 19/05/2024 Economy
Multimedia
Việt Nam plans to preserve ethnic minorities’ intangible cultures at risk of disappearing
06:00 | 15/05/2024 Lifestyle
The Hải Phòng Red Flamboyant Festival celebrated the city's special UNESCO status
16:49 | 13/05/2024 Lifestyle
HCM City: top spot in Việt Nam for slow travel lovers
09:00 | 13/05/2024 Tourism
The Anam Cam Ranh named among Vietnam’s best family hotels
06:00 | 11/05/2024 Vietnamese Brands
Nguyễn Dynasty Urns in Huế make it to the UNESCO Memory of the World List
07:00 | 11/05/2024 Lifestyle
Tax, land rent payment deadlines to be extended this year
06:00 | 19/05/2024 Policy
Ministry proposes tax filing deadline extension for 2024
06:00 | 17/05/2024 Policy
Viet Nam targets to have 2 million enterprises by 2030
07:00 | 15/05/2024 Policy
Law on Telecommunications hoped to promote development of new telecoms services
06:00 | 13/05/2024 Policy
Energy giants plan for national power plan
06:00 | 18/05/2024 Energy
Vietnam charts vision for sustainable, modern fisheries
06:00 | 16/05/2024 Industry
Vietnam should seize opportunity to join global semiconductor supply chain
08:00 | 15/05/2024 Industry
Việt Nam's wood industry strives to match sustainable wood demands
07:00 | 14/05/2024 Industry
Delegation from EU, Netherlands explore investment opportunities in Thai Nguyen
07:10 | 18/05/2024 FDI
Desk established in Dong Nai to support Japanese investors
09:02 | 16/05/2024 Investment
Vietnam should not miss opportunities to attract FDI
08:00 | 14/05/2024 FDI
New wave of Chinese investment
06:00 | 12/05/2024 FDI
Banks raise interest rates to attract depositors
16:47 | 17/05/2024 Finance-Banking
Credit access obstacles lifted for collective economic entities
06:00 | 16/05/2024 Finance-Banking
Government urged to narrow domestic, global gold price gap
08:36 | 15/05/2024 Finance-Banking
Biometric verification ensures safer money transfers
17:23 | 13/05/2024 Finance-Banking
First provincial biodiversity museum launched in Quảng Nam
06:00 | 19/05/2024 Environment
Enhancing informal sector’s role in EPR implementation
06:00 | 18/05/2024 Environment
Centre opened to serve environmental data integration, monitoring network operation
06:00 | 16/05/2024 Environment
Capacity building for policy makers, large emitters on ETS and carbon market
08:48 | 15/05/2024 Environment
Semiconductor investment prioritized
06:29 | 17/05/2024 Science - Technology
Full cyber stream ahead Bắc Giang focuses on digital society development
06:00 | 11/05/2024 Science - Technology
35 localities piloting four-wheel EVs for tourists, despite no official legal regulations
07:00 | 09/05/2024 Science - Technology
2024 VinFuture Prize records 1,469 nominations
06:00 | 07/05/2024 Science - Technology
HCM City to complete 183km of metro routes by 2035
06:00 | 17/05/2024 Society
Railway sector gets creative to attract passengers
07:00 | 15/05/2024 Society
Việt Nam’s largest high-speed ship service from HCM City to Côn Đảo launched
07:00 | 14/05/2024 Society
Central Highlands to become renewable energy hub
08:58 | 13/05/2024 Society
Vietnamese agricultural products to take part in Foodservice Australia 2024
15:08 | 17/05/2024 Vietnamese Brands
PV GAS launches Month of Workers
10:22 | 16/05/2024 Companies
National Brand Program promotes prestigious Vietnam
13:09 | 15/05/2024 Vietnamese Brands
Largest made-in-Vietnam bulk carrier launched
17:07 | 13/05/2024 Vietnamese Brands
Việt Nam plans to preserve ethnic minorities’ intangible cultures at risk of disappearing
06:00 | 15/05/2024 Lifestyle
The Hải Phòng Red Flamboyant Festival celebrated the city's special UNESCO status
16:49 | 13/05/2024 Lifestyle
Nguyễn Dynasty Urns in Huế make it to the UNESCO Memory of the World List
07:00 | 11/05/2024 Lifestyle
European Literary Days focuses on gender
06:00 | 09/05/2024 Lifestyle
Tourism sector goes green for sustainable development
08:22 | 19/05/2024 Tourism
Vietnamese tourism information centre opened in India
08:00 | 18/05/2024 Tourism
Mysterious 'floating' lake discovered in Quảng Bình
16:54 | 13/05/2024 Tourism
HCM City: top spot in Việt Nam for slow travel lovers
09:00 | 13/05/2024 Tourism